Private activity bonds

The final version of the tax bill struck by Congressional negotiators would continue to subsidize municipal bonds that help businesses to finance infrastructure projects such as airports and toll roads, dropping one provision that threatened to cut sales of tax-exempt debt by tens of billions of dollars starting next year.

In the rush to borrow before the Republican tax bill reshapes the debt market, states and municipalities are paying up. The biggest spree of debt issuance in more than a decade has pushed up borrowing costs and eroded returns in the $3.8 trillion municipal-debt market.

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